Are Your Local Reviews Hurting Your Business?

If you’re a business owner, you know that one of the most important indicators of your business’s success is what people are saying about your company. Because of the large number of customer review sites available, as well as the billions of users on social media, it’s not hard to get feedback about your business instantly. And, unfortunately, some of your reviews may not be positive. Whether or not poor reviews hurt businesses is a topic that isn’t as clear-cut as you may think. There are factors to consider when attempting to ascertain if your business is being harmed by bad reviews.

Who Leaves Reviews?

One argument against the idea that bad reviews damage businesses is that the people who leave reviews tend not to represent the bulk of the customers that you have. The University of Maryland researched online behavior and sales forecasting and found that customers who leave reviews tend to have three characteristics in common: they’re a vocal minority, they have extreme opinions, and they may be pushing their own agenda. Only a small percentage of customers actually take the time to leave reviews online, and those that choose to take time out of their day and leave a review likely had a strong reaction—either positive or negative—to your business. People who provide reviews, particularly scathing ones, also embellish upon their experience, the University of Maryland found. Their own agenda is to portray themselves as experts, and one way to sound like an authority is to use an authoritative, negative tone.

However…

This doesn’t mean you should ignore bad customer reviews, as they can be filled with constructive criticism that helps your business change things that may be impacting you negatively. Consider customer reviews as cues to how you can change for the better. While some may be hard to read at times (no one likes getting told they’re doing a bad job), in the end, responding to online reviews can and will definitely help your business.

Short-Term or Long-Term Effects?

The University of Maryland study mentioned above found that bad customer reviews have short-term effects, but the impact is limited to the short-term and isn’t going to irrevocably hurt your business if they don’t continue (i.e. you fix the problem). Interestingly enough, the study found that product sales for the industry that you’re in went up. This could possibly be because any strong reviews are going to draw attention to your industry, leading more people to look at other products that are related.

How to Deal With Disgruntled Reviews

Aside from constructive criticism and explanations of why a customer is dissatisfied, you should also be on the lookout for disgruntled employees leaving reviews. It’s not unheard of for a fired employee, or one that is unhappy, to leave a bad review and possibly cause damage to your business. If you think that this may be the case, attempt to resolve the issue offline so that your reviews remain as unbiased as possible.

How to Handle a Bad Review

A negative local review might sting a little bit, but upon receiving it, you should read it in full and ascertain whether the criticism has merit. If you believe that the criticism makes sense and is viable, you will have the opportunity to act on it and remove the problem that could be harming your business.

Online reviews are a double-edged sword. On one hand, they can be helpful in allowing a business to pinpoint what its weaknesses and strengths are. On the other hand, negative online reviews have been proven to harm businesses in the short term, and there is always a risk that the reviews are being tinted with bias. Bottom line: use your best judgement, and evaluate each review thoroughly.